SK hynix and Intel have agreed a deal which has SK hynix buying Intel’s NAND reminiscence and storage enterprise for $9 billion.
The deal contains the NAND SSD enterprise, the NAND element and wafer enterprise, together with the Dalian NAND reminiscence manufacturing facility in China. Intel will proceed to have its Intel Optane enterprise which makes SSD reminiscence modules. Initially first reported by the Wall Avenue Journal, the acquisition by SK hynix means it’s now one of many world’s largest NAND reminiscence makers, second solely to Samsung.
For Intel, it means they will now use the proceeds from the deal to deal with synthetic intelligence, 5G and edge computing. In an announcement, Intel chief govt officer, Bob Swan, defined, “for Intel, this transaction will enable us to to additional prioritise our investments in differentiated know-how the place we are able to play an even bigger function within the success of our clients and ship enticing returns to our stockholders.“
Intel appears to be going all in with its plans to develop in synthetic intelligence and 5G with it beforehand promoting nearly all of its modem enterprise to Apple for round $1 billion and likewise citing again then that it could be to permit the agency to place “our full effort into 5G the place it most intently aligns with the wants of our world buyer base.“
As is customary for such hefty offers, regulatory approval is not anticipated till late 2021 with a last closing of all property happening in March 2025. Within the meantime, Intel will proceed to fabricate NAND wafers at its Dalian foundry.
NAND enterprise represented about $2.eight billion of income for Intel within the six month interval ending June 27th 2020 which, in accordance with the Wall Avenue Journal, made up nearly all of the agency’s complete reminiscence gross sales throughout that point interval. It looks as if fairly a giant shift for Intel, albeit not an sudden one given its continued plans for 5G and AI.
SK hynix CEO Seok-Hee Lee has already defined that the deal will enable it to “optimise [its] enterprise construction, increasing [its] progressive portfolio within the NAND flash market section.”
It comes at a time when the US authorities has positioned commerce restrictions on Chinese language know-how which might be why Intel needs rid of its Dalian facility in the long run, being its solely main foundry within the nation.
Whereas we cannot see the consequences of this buy for some time but, it appears clear that SK hynix is aiming to be extra aggressive inside the storage market whereas Intel pursues a distinct route. Maintain your eyes on what occurs subsequent.